Dear all,

I run a regression of financial reporting quality (FRQ) on investment where I have a variable Overinvest that ranks from 0 to 1 that increases with the likelihood of overinvestment. So if Overinvest is 1 a firm is likely overinvesting and if it's 0 it indicates underinvestment. My regression formula looks something like this: investment = b0 + b1*FRQ + b2*Overinvest + b3*FRQ*Overinvest + controls. To calculate the total effect of financial reporting quality on investment for firms likely to overinvest I therefore want to calculate the joint significance of b1 + b3 but I don't know how to do this in stata. Could anybody tell me how to do this?

With kind regards,

Norbert Langerak